Countdown to Drupa: Report on impact of internet on print, part II

The shift to mass customisation

The industry has seen a dramatic shift from mass production of static print to an ever-increasing proportion of small-runs of digital print and down further to individual runs of one. Digital communications has driven this shift, supported by sophisticated data management and workflows. Variable data print (VDP) is the essential prerequisite for customisation and the net effect is forecasts of a slow decline in static print (0.5% per annum to 2017) contrasted with rapid growth of digital (electrophotographic at 1.5% per annum– building on a large installed base and inkjet at 14% per annum – reflecting the small installed base) to double digital print’s share of total print volume to 14% by 2017.

Total 72% of the commercial printers in the Drupa panel offer VDP and 56% reported modest or fast growth, albeit from a low base. Indeed, the panel’s commercial printers selected cutsheet digital electrographic presses as their top print investment. Another striking development is the rapidly growing popularity of interactive print (QR codes, augmented reality, etc) that enables print to play a role in an online sales cycle. Total 32% of the expert panel offer at least one such service.

One key driver of mass customisation is the ever-increasing volume of digital data that is being held – so-called ‘big data,’ where the volumes are so large that conventional analyses would struggle to cope. For example, online business data is forecast to grow at a compound annual rate of 40%. However, with the right software and skills to drive it, very exact segmented marketing, down to the level of individuals, can occur – either digitally or by printing. Here is a great opportunity for printers (who are used to handling high volumes of digital data) to manage and analyse customers’ data for them.

Packaging supply chains are responding to such opportunities to create just-in-time, on-demand business cycles that reduce lead times, cost and waste. Technical issues such as exact colour management are being resolved and supply chains are becoming agile enough to exploit the opportunities. Indeed, among packaging printers on the expert panel, 50% reported they offer interactive print of one form or another, 43% offer variable content and 41% some form of personalisation, albeit only a low level of SKUs are involved at present.

The internet has both increased the opportunities for personalisation and the competition to win that business, as customers no longer have to meet the printer and printers can compete in an ever-wider geographic market. Customisation has added new products to the conventional list of personalised products (business cards, stationery, etc) with items such as photobooks and calendars for commercial printers and décor items for industrial printers.

Over 50% of the panel’s commercial printers offer some products that are personalised, although some products involve a higher level of investment in specialist equipment and marketing to compete successfully, for example photobooks. Direct mail is offered by 51% of the panel’s commercial printers and while there is plenty of evidence of a sharp decline in the total volume of direct mail, strategically targeted direct mail is growing. Overall, printers need to get much closer to their customers and end-users, to capture data and understand how personalisation can be relevant, timely and provide added value.

Managing with the internet

Regardless of what you are printing or how, the internet can assist printers in becoming more competitive. For example, it is fundamentally changing the way businesses are conducting their sales and marketing. The Drupa expert panel admitted to a very patchy adoption of such techniques as customer database management (just 34% use it), website analytics (23%) and social media (25%) and only 17% use these in integrated campaigns that are demonstrably the best way to exploit these techniques.

Turning to customer service and production, we have all been impressed with examples in our daily life of effective multi-channel ‘customer journeys’ as well as painful examples of the reverse. How many printers have assessed their own company’s ‘customer journeys’ objectively? Certainly 84% of the Drupa panel reported use of FTP/upload portals, but only 55% use automated pre-flight testing and 44% use digital asset management. Surprisingly only 47% claimed integrated estimating, order processing and job bag production and only 21% reported a fully automated order processing system from enquiry to invoicing.

As for other online business services, 68% used online purchasing and 54% of those with an MIS had remote access but less than half used online training, recruitment, business intelligence and credit checking. It is puzzling to see the low take-up figures for all these online aids to greater competitiveness and efficiency.

Summary

The print industry is in a period of unprecedented change driven by digital media, the internet and changing consumer demand. This report highlights the need for change and demonstrates that most printers are changing more slowly than the world around them. The technology is available to facilitate this change and there are many new exciting applications and growth opportunities to exploit. Printers just need to believe in the reality of a multi-channel digital future, change their mind-set and invest accordingly.

(Courtesy blog.drupa.com)